1. Bank Car Loans
Irish banks like AIB, Bank of Ireland, Permanent TSB, and KBC offer personal loans that can be used to finance cars.
- Interest Rates: Typically range from 6% to 9% APR depending on your credit score.
- Benefits: Fixed monthly repayments, flexibility in loan term, and ownership from day one.
2. Credit Union Car Loans
Credit unions in Ireland are very popular for car financing.
- Rates: Often lower than banks, around 5% to 7% APR.
- Advantages: No hidden fees, no early repayment penalties, and flexible terms.
- Why choose this? If you are already a member, approval can be much faster.
3. Dealer Car Finance (PCP & Hire Purchase)
Car dealerships in Ireland offer PCP (Personal Contract Plans) and Hire Purchase deals.
- PCP: Lower monthly payments, but you don’t fully own the car until the final balloon payment.
- Hire Purchase: Pay fixed monthly installments, and own the car at the end.
- Downside: Less flexibility compared to bank or credit union loans.
4. Online Personal Loans
Some online lenders and digital banks provide quick approval for car loans.
- Pros: Fast approval, competitive rates.
- Cons: Higher interest if credit score is low.
Current Car Loan Interest Rates in Ireland (2025)
| Lender | APR Range | Loan Amount | Loan Term | Notes |
|---|---|---|---|---|
| AIB | 6% – 9% | €5,000 – €75,000 | Up to 5 years | Flexible repayment |
| Bank of Ireland | 6.5% – 9% | €2,000 – €65,000 | Up to 7 years | Quick approval |
| Permanent TSB | 7% – 9% | €1,500 – €50,000 | Up to 5 years | Online application |
| Credit Unions | 5% – 7% | Varies | Flexible | No hidden fees |
| Dealer Finance (PCP/HP) | 3% – 6% (introductory) | Based on car value | 3 – 5 years | Balloon payment applies |
Car Loan vs. Car Finance: Which is Better?
- Car Loan (Bank/Credit Union):
You own the car from day one
More flexible repayment
No balloon payment surprises - Car Finance (PCP/Hire Purchase):
Lower monthly payments
Easier approval at dealerships
You don’t own the car until the last payment
Restrictions on mileage and car modifications
If you want full ownership, go for a bank or credit union loan. If you want lower monthly payments and plan to change cars often, PCP might suit you.
Tips to Get the Best Car Loan in Ireland
- Check Your Credit Score – Higher scores mean lower interest rates.
- Compare Lenders – Don’t accept the first offer; check banks, credit unions, and online lenders.
- Negotiate With Dealers – If using PCP, always negotiate final payments.
- Consider Loan Term – Longer terms reduce monthly payments but increase total interest.
- Look Out for Hidden Fees – Check if there are early repayment charges or admin fees.
FAQs
1. What is the average car loan interest rate in Ireland?
Most car loan interest rates in Ireland range from 5% to 9% APR in 2025.
2. Is a credit union car loan better than a bank loan?
Yes, credit union loans are often cheaper and more flexible, especially with no hidden fees.
3. Can I get a car loan with bad credit in Ireland?
Yes, but interest rates will be higher. Consider improving your credit score before applying.
4. Which is better: PCP or car loan?
A car loan is better if you want ownership, while PCP is good for lower monthly payments and upgrading cars often.
5. What documents are needed for a car loan in Ireland?
Proof of income, ID, address proof, and sometimes your credit history.